Saudi Arabia among world top donors

The Saudi Aid Platform has revealed that the total value of financial assistance provided by Saudi Arabia to around the world is amounted to approximately SR528.4 billion (US$140.9 billion), cementing the Kingdom's position as one of the largest donors globally.

The Saudi official platform revealed that Egypt topped the list of countries that benefited most from Saudi aid, with a total of US$32.49 billion, followed by Yemen with US$27.69 billion, and then Pakistan with US$13.19 billion. The list of countries that benefited the most also included Syria (US$7.53 billion) Iraq (US$7.33 billion) and Palestine (US$5.37 billion).

These figures reflect the Kingdom's commitment to its humanitarian and development role by supporting peoples and countries in confronting humanitarian crises and natural disasters, and achieving sustainable development.

These efforts are part of the realization of Saudi Vision 2030 goals that focus on strengthening international partnerships and establishing the Kingdom as a pillar of regional and international peace and stability, under the leadership of Custodian of the Two Holy Mosques King Salman and Crown Prince and Prime Minister Mohammed bin Salman.

It is noteworthy that the Saudi Aid Platform is the precise electronic reference for the Kingdom's foreign contributions. The platform is divided into three categories: humanitarian, development and philanthropic projects, contributions to international organizations and bodies, and visitors’ services (refugees living inside the Kingdom).

The Saudi Aid Platform, inaugurated by King Salman in 2018, highlights the size and type of assistance provided by Saudi Arabia. The King Salman Humanitarian Aid and Relief Centre (KSrelief) re-launched this platform.

Due to the multiplicity of Saudi donor entities, this platform has become an imperative and effective tool for collecting, coordinating and documenting statistics on international assistance provided by the Kingdom to countries and people in need around the world.

Understanding US and Russian policies towards Taliban

Russia has become the first country to recognize Taliban government in Afghanistan. It is on record that the United States and Russia have had different policies toward Taliban due to their distinct strategic interests, historical experiences, and regional alliances. Here’s a breakdown of some of the key reasons behind this divergence:

The United States has fought Taliban directly for over two decades after 9/11, viewing them as terrorist allies of al-Qaeda. This includes the US led NATO invasion of Afghanistan in 2001 to topple the Taliban regime.

Interestingly, Russia has not fought Taliban directly but has a history of conflicts in Afghanistan during the Soviet invasion (1979–1989), where the US and others supported the Mujahideen, some of these are now termed Taliban).

Russia sees Taliban as part of the post-Soviet regional security dynamic, not necessarily as a direct enemy.

Most interesting is the US perspective because it considers Taliban a threats to US homeland and allies. The history shows that Afghans/ Taliban never attacked the United States. It is also said that Osama bin Laden was a Saudi, which supported Mujahideen in averting the USSR attack on Afghanistan to get access to the warm waters.

The US, which never wanted to leave Afghanistan believes that Taliban rule could once again turn the country into a safe haven for global jihadis like al-Qaeda or ISIS-K. Some analysts openly say that be it al-Qaeda or ISIS-K, these are ‘B’ teams of CIA.

The prime focus of Russia is more on Central Asian stability and drug trafficking from Afghanistan. Russia fears spillover of extremism into its southern borders but engages pragmatically with Taliban to keep its influence in the region.

Both the US and Russia are keen in engaging with Taliban. The US was initially hostile, but later engaged diplomatically, courtesy Doha talks, culminating in the 2020 US-Taliban agreement. After the 2021 withdrawal, the US maintains non-recognition and economic sanctions, demanding women rights, inclusivity, and action against terrorism.

As against, Russia has hosted Taliban delegations for talks in Moscow and calls for inclusive governance but does not condition engagement as strictly as the US. Russia did not officially recognize the Taliban either, but it was more flexible in diplomacy.

Strategic Interests

The US claims, to that many do not agree, that the super power is busy in global fight against terrorism and avoids getting entangled again in the Afghan conflict. Since withdrawal of troops the US has kept Taliban under pressure through sanctions and diplomatic isolation, including freezing foreign exchange reserves of Afghanistan.

The prime Russian interest is, ending US hegemony in the region. It also wants to protect its interests in Central Asia (Tajikistan, Uzbekistan and Turkmenistan). On top of all Russia seems to be keen in developing regional alliances that include Taliban as a reality, not a pariah.

Over the decades, the United States has maintained its hegemony through regional alliances, working closely under the NATO umbrella. The US policy towards Taliban is part of a broader Western approach tied to liberal values and counterterrorism.

Realizing its limitations Russia works closely with China, Iran, Central Asian republics. It often coordinates with anti-Western powers and is less constrained by democratic or human rights norms.

To get control over countries two of the world’s largest super powers, the United States as well as Russia have often used arsenal power. As against this China has used diplomacy and economic assistance to establish its influence.

During the election campaign Donald Trump had promised to pull the United States out of wars, but his unconditional support to Israeli genocide in Gaza and direct attacks on Iran prove he is also the tout of military complexes and would never like to end wars where the United States is involved directly or indirectly.

 

Pakistan to sell excess LNG amid supply glut

Pakistan is exploring ways to sell excess liquefied natural gas (LNG) cargoes amid a gas supply glut that could cost domestic producers US$378 million in annual losses, reports Reuters.

The country has at least three LNG cargoes in excess that it imported from top supplier Qatar and has no immediate use for, and is currently selling natural gas at steep discounts to local users.

Power generation from gas-fired power plants, which has historically accounted for a lion's share of LNG use in the country, has declined for three straight years ended 2024, with cheaper solar power use dramatically gaining at the expense of gas-fired generation, data from energy think-tank Ember showed.

Pakistan is currently exploring the possibility of transferring LNG cargoes to rented tankers for "offshore storage and onward sale," state-owned oil and gas producer OGDCL said in a presentation to industry and government.

"Excess LNG in the gas network has resulted in significant production operations impact for local exploration and production companies over last 18 months," OGDCL said, adding that it had forced curtailment of domestic supply.

The domestic industry could suffer US$378 million in losses over the next 12 months at the current rate of curtailment, according to the presentation dated May 29 reviewed by Reuters.

It is not immediately clear if Pakistan's long-term LNG import contracts with QatarEnergy allows for a resale of cargoes. One of the government officials said the country was still exploring ways to do it.

Qatar typically has a destination clause in long-term supply contracts with buyers that restrict where the cargoes can be sold.

Pakistan has already deferred five contracted LNG cargoes from Qatar without financial penalty, shifting delivery from 2025 to 2026, as the country grapples with surplus capacity.

Pakistan's petroleum minister Ali Pervaiz Malik declined to comment on the presentation, but said renegotiating contracts with Qatar was a "complex" process that could take at least a year, and a final decision on initiating it had yet to be made.

"While the existing contract with Qatar allows Pakistan to decline vessels, doing so incurs penalties and other complications," Malik told Reuters.

The glut has stemmed from several gas-fired power plants, previously operating under must-run contracts, now being sidelined, Malik said.

"It was expected that summer season will create extraordinary demand but the trend indicates the opposite," OGDCL said in the presentation.

 

Pakistan assumes UN Security Council presidency

As the world grapples with escalating conflicts, deepening geopolitical rifts, and growing doubts over the efficacy of multilateral institutions, Pakistan assumes the presidency of the United Nations Security Council on Tuesday, taking on a symbolic but strategic role at a particularly fraught moment.

This marks Pakistan’s eighth term on the 15-member body and its first presidency since 2013. Islamabad began its current two-year term as a non-permanent member in January 2025 and will serve through the end of 2026.

Talking to Dawn, Pakistan’s Permanent Rep­resentative to the UN, Ambassador Asim Iftikhar Ahmad, noted the challenges that define the current international landscape.

“Pakistan is going to assume the presidency of the United Nations Security Council at a time of global tumult marked by growing instability, escalating conflicts, complex geopolitical and geostrategic landscape, and serious threats to international peace and security,” he said.

While the presidency rotates monthly and does not carry executive authority, it allows the presiding country to influence the Council’s agenda and tone — a platform that matters at a time when the UNSC is increasingly seen as deadlocked, especially on issues like Gaza and Ukra­i­­ne. With global trust in multilateral mechanisms under strain, Pakistan’s leadership — even if brief — will be closely watched.

The ambassador underscored Pakis­tan’s commitment to its long-held positions on peaceful conflict resolution. “Pakistan has been a staunch and consistent advocate of dialogue and diplomacy… We will bring a principled and balanced perspective to the work of the Security Council,” he said, pledging to strengthen multilateralism and deepen cooperation with other UNSC members.

“We seek to promote transparency, incl­u­sivity and responsiveness during Pakis­tan’s presidency,” said Ambassador Ahmad. “We will closely work with other Cou­ncil members in a spirit of cooperation for collective and timely action… in line with the UN Charter and corresponding to the exp­ectations of the international community.”

 

 

Mari Energies EPS declines 10%YoY

Mari Energies (MARI) held its corporate briefing session on Monday to discuss 9MFY25 results. MARI announced 9MFY25 profit after tax of PKR46.3 billion (EPS: PKR38.54), down 10%YoY.

Key takeaways from the briefing:

MARI has the second highest reserve base in Pakistan, with 2P and 2C reserves currently at 816mmboe, boasting a reserve life of 17 years.  

MARI reported production of approximately 30mmboe during 9MFY25. However, output continues to face headwinds due to gas curtailment stemming from pipeline bottlenecks, a challenge likely to intensify as more gas based captive power plants transition to the national grid. Management is actively engaging with the government to address and resolve the issue.

Update on Waziristan Block:

Production from the Shewa field commenced on March 23, 2025, and is currently yielding around 50mmcfd of gas and 450bpd of oil. However, these figures remain significantly below the tested flow rates of 70mmcfd of gas and 700bpd of oil, primarily due to production curtailments.

MARI has announced a major discovery at the Spinwam well in the Waziristan Block, reporting promising hydrocarbon potential across multiple reservoirs. The company estimates total recoverable reserves at around 799bcf and is currently in the process of finalizing the field development plan.

Update on Mari D&P:

MARI has drilled a total of nine wells in the Ghazij formation, including one exploratory, four appraisal, and four development wells—all of which have been brought online and are currently producing around 35mmcfd of gas. To complete Phase 1 of the development plan, the company intends to drill additional development wells in FY26.

MARI made Shawal discovery in April 2024 which is producing 15mmcfd of gas, 8bpd of oil and 290bpd of water. MARI has planned to drill appraisal wells during FY26 and management expects to increase production to 30mmcfd of gas and 50bpd of oil. 

Management expects production from the HRL reservoir to remain stable over the near to medium term. However, periodic fluctuations may occur due to planned turnarounds at fertilizer plants. Regarding a potential price revision for HRL gas, management noted that the field remains economically viable at current rates, making a price increase unlikely from the government’s perspective.

Update on Offshore Block 5 – Abu Dhabi:

A Production Concession Agreement (PCA) has been signed between PIOL, ADNOC, and SCFEA, under which ADNOC assumes operatorship of the block with a 60% working interest, while the remaining 40% is held by PIOL.

 

 

India refuses to sign joint statement at China

According to Saudi Gazette, India refused to sign a joint statement at the Shanghai Cooperation Organization (SCO) summit in China as it did not reflect the country's concerns on terrorism, India's foreign ministry has said.

Spokesperson Randhir Jaiswal said on Thursday that India's desire for its concerns to be reflected was "not acceptable to one particular country".

While he did not share more details, Indian media reported that Delhi refused to sign the statement after it omitted the Pahalgam attack, a deadly militant attack that killed 26 tourists in Indian administered Kashmir.

India has blamed its neighbour, Pakistan for sheltering a militant group it blames for the attack. Pakistan has rejected the allegations.

China, Russia and four Central Asian countries formed the SCO in 2001 as a countermeasure to limit the influence of the West in the region. India and Pakistan joined in 2017.

The latest signing ceremony took place during the SCO defence ministers' meeting in China, held ahead of the leaders' annual summit this autumn.

According to media reports, India perceived the joint statement as being "pro Pakistan" after it omitted the Pahalgam attack but mentioned militant activities in Baluchistan.

Pakistan has accused India of backing the Baluchistan freedom movement, which India denies.

After the meeting, India's Defence Minister Rajnath Singh urged the SCO to hold the perpetrators of cross-border terrorism accountable, though he didn't explicitly mention Pakistan.

"Some countries use cross-border terrorism as an instrument of policy and provide shelter to terrorists. There should be no place for such double standards. SCO should not hesitate to criticize such nations," he said in a statement.

The Pahalgam attack in April brought the two nuclear-armed countries to the brink of another war.

In May, India launched a series of airstrikes, targeting sites it called "terror infrastructure in Pakistan and Pakistan administered Kashmir".

Pakistan denied the claim that these were terror camps and also responded by firing missiles and deploying drones into Indian territory.

The hostilities between the two countries continued until May 10 when President Donald Trump announced that India and Pakistan had agreed to a "full and immediate ceasefire", brokered by the United States.

India has consistently denied any intervention by the United States.

Pakistan: Encouraging IMF Staff Level Report

The recently released IMF staff level report praises Pakistan’s strong program implementation and stresses the need to prioritize reforms going forward.

These include reforms to strengthen competition and productivity, improve SOEs and public services, increase energy sector viability, broaden the tax base, and build climate resilience.

Several new structural benchmarks have been introduced, which will impact multiple sectors such as Energy and Autos, and these may be part of the upcoming FY26 Budget.

Pakistan’s macroeconomic recovery has been cemented by growing foreign exchange reserves and sharply lower inflation, enabling the State Bank of Pakistan (SBP) to halve the policy rate to 11.0%.

GDP growth in FY26 is expected to reach the long-term average, and modestly accelerate thereafter. The current account is expected to remain in control, aided by lower oil prices and strong remittances.

This may limit pressure on the PKR, even as the IMF has encouraged a more flexible exchange rate.

Containing the fiscal deficit, as ever, will likely prove to be the most challenging. The projected improvement on the fiscal deficit is contingent on tax collection, including the effective implementation of the newly introduced Agriculture Income Tax laws.

That said, climate-related funding by the IMF (US$1.4 billion over the course of the program) can be used for budgetary support, which is a positive. 

As of December 2024, Pakistan had met all seven quantitative performance criteria and five of eight indicative targets. Compliance with structural benchmarks was also generally strong.

Important structural benchmarks that have already been met include approval of the National Fiscal Pact, and introduction of Agriculture Income Tax laws at the provincial level. However, others are still pending including eliminating captive power use in the gas sector. The IMF has now introduced additional structural benchmarks.

PSX benchmark index up 11.64%WoW

Pakistan Stock Exchange (PS) regained momentum after a ceasefire agreement between Pakistan and India on May 10, 2025, brokered through US mediation. This eased geopolitical tensions and helped stabilize investor sentiment following a week of heightened volatility. The benchmark index closed the week on May 16, 2025 at 119,649 points, recording a gain of 12,474 points, up 11.64%WoW.

On the first trading day of the week, the benchmark KSE-100 index surged by 10,123 points— the highest single-day gain in point terms. Investor confidence was further reinforced by the International Monetary Fund’s approval and disbursement of US$1 billion tranche under the Extended Fund Facility (EFF) and approval of an additional arrangement for the US$1.4 billion under the Resilience and Sustainability Facility (RSF).

On the macroeconomic front, workers’ remittances were reported at US$3.2 billion, resulting in a current account surplus of US$12 million during April 2025. Alongside, Net FDI for the month was reported at US$141 million. Foreign exchange reserves held by State Bank of Pakistan (SBP) increased by US$71 million to US$10.4 billion.

Average daily trading volume was up by 34.8%WoW to 685 million shares as compared to 508 million shares traded in the earlier week.

Other major news flow during the week included: 1) GoP proposed to 10% tax cut for salaried class, 2) Pakistan and Russia consented to set up a steel mill, 3) IFEM on petrol and diesel increased, 4) Prime Minister set up panel for petroleum sector reforms, and 5) Pakistan and India talks in Saudi Arabia to be scheduled shortly.

Vanaspati & Allied Industries, Transport, Refinery, Woollen and Inv.Banks/ Inv.cos/ Securities.cos were amongst the top performers, while Textile Spinning and Jute were amongst the worst performers.

Major selling was recorded by Banks/ DFIs with a net sell of US$20.6 million. Mutual Funds absorbed most of the selling with a net buy of US$39.2 million.

Top performing scrips of the week were: AGL, FCEP, PTC, ATRL and SEARL, while laggards included: PKGP, IBFL, NESTLE, and PGLC.

According to AKD Securities, PSX is expected to remain positive in the coming weeks, with the recent announcement of a ceasefire and release of tranche by IMF likely to be key triggers. The KSE100 is anticipated to sustain its upward trajectory, driven by strong earnings in Fertilizers, sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability.

Top pick of the brokerage house include: OGDC, PPL, PSO, FFC, ENGROH, MEBL, MCB, HBL, LUCK, FCCL, INDU and SYS.

Saudi Arabia welcomes Trump's visit

The Council of Ministers welcomed on Monday the official visit of US President Donald Trump to Saudi Arabia, expressing optimism that the visit would strengthen and expand cooperation and the strategic partnership between the two friendly countries across various sectors, in a way serving their mutual interests and visions. Crown Prince and Prime Minister Mohammed bin Salman chaired the Cabinet session in Riyadh.

At the outset of the session, the Crown Prince briefed the Cabinet on the outcomes of recent talks with leaders of several friendly nations, focusing on bilateral relations and issues of mutual interest.

In a statement to the Saudi Press Agency following the session, Minister of State, Cabinet Member for Shoura Council’s Affairs and Acting Minister of Media Dr. Essam bin Saad bin Saeed said that the Cabinet reviewed regional and international developments and reiterated its firm condemnation of the Israeli occupation authorities' announcement regarding their incursion into and control of the Gaza Strip and Palestinian territories, as well as their ongoing violations of international humanitarian law. The Cabinet reaffirmed the Kingdom's unwavering support for the Palestinian cause and the rights of the Palestinian people.

The Cabinet welcomed the ceasefire agreement between Pakistan and India, and affirmed the Kingdom’s continued commitment to working with international partners to achieve lasting peace between the two nations.

The Cabinet discussed progress in cooperation with international organizations and forums, emphasizing that the Kingdom's hosting of the Munich Security Conference Leaders' Meeting in the last quarter of 2025 reflects its commitment to supporting multilateral approaches that promote international peace and security and address global challenges.

The Cabinet regarded the Kingdom’s election as the Arab Group’s representative to the International Civil Aviation Organization (ICAO) Council as a testament to its leading role and ongoing efforts in advancing the aviation sector at the local, regional, and international levels, in accordance with the highest standards of safety and efficiency.

The Cabinet approved the guidelines for green investments. It approved the regulations to organize the General Authority of Civil Aviation. The Cabinet endorsed formation of a working group, headed by the General Directorate of Civil Defense and including members from several entities, to implement a program to raise awareness of meteorological phenomena, the mechanism for avoiding their risks, and the implications of alerts and warnings.

The Cabinet decided that the state would bear the taxes and customs duties on live livestock shipments from Dhul Qada 11, corresponding to May 9, until the end of this year's Hajj season.

The Cabinet approved a memorandum of understanding (MoU) between the Saudi Ministry of Energy and the Italian Ministry of Environment and Energy Security for cooperation in the field of energy, and a general cooperation agreement between the governments of Saudi Arabia and Eswatini.

The Council authorized the minister of foreign affairs or his deputy to discuss and sign with the Vanuatuan side a draft general cooperation agreement between the two governments, in addition to authorizing the minister of education or his deputy to discuss and sign with the US side a draft MoU for cooperation in the field of education and training.

The Cabinet approved a MoU between the Saudi Food and Drug Authority and the Chinese National Medical Products Administration for cooperation in the field of regulating drugs, medical devices, and cosmetics, and another MoU between the Saudi Human Rights Commission and Tajikistan's Commissioner for Human Rights.

The Council approved a MoU between the Saudi Presidency of State Security and the Omani General Secretariat for Communications and Coordination in the field of combating terrorism crimes and their financing, and another MoU for cooperation and news exchange between the Saudi Press Agency and the Senegalese Press Agency.

 

India and Pakistan accuse each other of ceasefire violations

India and Pakistan accused each other of violating an agreed ceasefire on Saturday, just hours after reaching the US-brokered deal aimed at ending one of the most dangerous escalations between the nuclear-armed rivals in decades, reports Reuters.

The ceasefire, which came after weeks of cross-border missile and drone strikes, was announced earlier in the day following negotiations involving top US and regional officials.

India’s Foreign Secretary Vikram Misri said the ceasefire agreement had been breached “repeatedly” and blamed Pakistan for initiating the violations.

Pakistan’s Foreign Ministry rejected the accusation and blamed Indian forces for violating the ceasefire. In a statement, the ministry said Pakistan remained committed to the truce and was “handling the situation with responsibility and restraint.”

The agreement had been announced earlier in the day by US President Donald Trump on his Truth Social platform. “Congratulations to both Countries on using Common Sense and Great Intelligence,” he wrote, hailing the full and immediate ceasefire deal.

Under the terms of the agreement, both sides pledged to halt all military action by land, air, and sea. Military officials from both countries spoke Saturday afternoon to finalize the terms.

Despite the mutual accusations, both governments have expressed interest in pursuing further talks. US Secretary of State Marco Rubio said discussions would soon begin on a broader agreement at a neutral site.

India and Pakistan agree to ceasefire

US President Donald Trump said on Saturday that India and Pakistan had agreed to a "full and immediate ceasefire" after a fourth day of strikes and counter-strikes against each other's military installations, reports Reuters.

Pakistan's foreign minister also said both countries had agreed to a ceasefire "with immediate effect" and India's foreign ministry said it would start at 5.00pm Indian time, 1130 GMT.

"After a long night of talks mediated by the United States, I am pleased to announce that India and Pakistan have agreed to a full and immediate ceasefire. Congratulations to both Countries on using Common Sense and Great Intelligence," Trump said in a post on Truth Social.

The sudden announcement came on a day when fears spiked that the countries' nuclear arsenals might come into play as Pakistan's military said a top military and civilian body overseeing its nuclear weapons would meet. The officials from both sides showed a willingness to take a step back following the day's exchanges, as the combined civilian death toll on the two sides rose to 66.

"Pakistan and India have agreed to a ceasefire with immediate effect," Pakistani Foreign minister Ishaq Dar posted on X.

"Pakistan has always strived for peace and security in the region, without compromising on its sovereignty and territorial integrity."

India's foreign ministry said that the head of Pakistan's military operations called his Indian counterpart on Saturday afternoon and it was agreed that both sides would stop all firing.

The two heads will speak to each other again on May 12, the ministry added.

The fighting began on Wednesday when India carried out strikes on what it said was "terrorist infrastructure" in Pakistani Kashmir and Pakistan, two weeks after 26 people were killed in an attack on Hindu tourists in Indian Kashmir.

Pakistan denied India's accusations that it was involved in the tourist attack. Since Wednesday, the two countries have exchanged cross-border fire and shelling, and sent drones and missiles into each other's airspace.

The countries have been locked in a dispute over Kashmir since they were born after the end of British colonial rule in 1947. Hindu-majority India and Islamic Pakistan both claim Kashmir in full but rule it in part.

They have gone to war three times since, including twice over Kashmir, and clashed several times.

India blames Pakistan for an insurgency in its part of Kashmir that began in 1989 and has killed tens of thousands. It also blames Pakistani Islamist militant groups for attacks elsewhere in India.

Pakistan rejects both charges. It says it only provides moral, political and diplomatic support to Kashmiri separatists.

 

 

India and Pakistan step up military strikes

Pakistan and India launched strikes and counter-strikes against each other's military installations on Saturday, prompting US calls for the nuclear-armed neighbours to begin talks and defuse their escalating conflict, the most intense since 1999.

Fears that the countries' nuclear arsenals might come into play spiked when the Pakistan military said a top military and civil body overseeing its nuclear weapons would meet, but the defence minister later said no such meeting was scheduled.

As tensions remain high, residents across Pakistan and India have rushed to stockpile food and other essential supplies, while families living near the border fled to safer areas. Indian authorities have installed sirens in high-rise buildings in New Delhi, some 650 kilometres (400 miles) from the border.

Pakistan early on Saturday said it had targeted multiple bases in India, including a missile storage site in India's north, in response to prior attacks by the Indian military.

India said there was limited damage to equipment and personnel at four air force stations. The military said there were several high-speed missile attacks on air bases in Punjab state and that India had responded to the attacks.

Five civilians were killed in the attacks in the Jammu region of Indian Kashmir, regional police said. Hindu-majority India and Islamic Pakistan both claim Kashmir in full but rule it in part.

Blasts rang out across Indian Kashmir and the Sikh holy city of Amritsar in neighbouring Punjab until early morning on Saturday. Jammu streets were empty hours after loud blasts were heard and projectiles were seen flying across the city sky.

"Jammu city has never been hit before. Never thought we will be hit like this," said 60-year-old Rajeev Gupta, whose brother was wounded by a shell.

Pakistan said that, before its offensive, India had fired missiles at three air bases, including one close to the capital, Islamabad, but Pakistani air defences intercepted most of them.

Locked in a longstanding dispute over Kashmir, the two countries have engaged in daily clashes since Wednesday when India launched strikes inside Pakistan on what it called "terrorist infrastructure". Pakistan vowed to retaliate.

Pakistan's information minister said in a post on X that Saturday's military operation was named "Operation Bunyanun Marsoos". The term is taken from the Koran and means a firm, united structure.

India has said its strikes on Wednesday, which started the latest round of clashes that have left more than 50 people dead in both countries, were in retaliation for a deadly attack on Hindu tourists in Indian Kashmir last month.

Pakistan denied India's accusations that it was involved in the tourist attack. Since Wednesday, the two countries have exchanged cross-border fire and shelling, and sent drones and missiles into each other's airspace.

Despite growing Western calls for peace, defence experts said the opposite seemed to be happening.

"Operations moving to next level - free use of missiles and drones by both sides," said Pravin Sawhney, a defence author and former Indian Army officer. "And reports that Pakistan Army is moving troops forward. Not good indications of what lies ahead!"

India strikes Pakistan

According to Reuters, India attacked Pakistan and Pakistani Kashmir on Wednesday. Pakistan said it had shot down five Indian fighter jets in the worst fighting in more than two decades between the nuclear-armed enemies.

India said it struck nine Pakistani "terrorist infrastructure" sites, some of them linked to an attack by Islamist militants on Hindu tourists that killed 26 people in Indian Kashmir last month. Islamabad said six Pakistani locations were targeted, killing eight people.

Indian forces attacked the headquarters of Islamist militant groups Jaish-e-Mohammed and Lashkar-e-Taiba, an Indian defence source told Reuters.

"India has demonstrated considerable restraint in selection of targets and method of execution," the Indian defence ministry said in a statement.

Pakistan said Indian missiles hit three sites and a military spokesperson told Reuters five Indian aircraft had been shot down, a claim not confirmed by India.

"All of these engagements have been done as a defensive measure," military spokesperson Ahmed Sharif Chaudhry said. "Pakistan remains a very responsible state. However, we will take all the steps necessary for defending the honour, integrity and sovereignty of Pakistan, at all cost."

 

Pakistan: SBP lowers interest rate by 100bps

After keeping the rates unchanged in March’s monetary policy, the State Bank of Pakistan (SBP) has cut the policy rate by 100bps to 11.0%. The policy rate has halved in less than a year, down from 22.0% in June 2024. Intermarket Securities believes the key reasons behind the rate cut are:

Headline CPI coming off to multi-decade low in April, with core inflation dipping to 8.0%YoY, resulting in an improved inflation outlook. 

Weak LSM readings feeding into anemic GDP growth of just 1.5%YoY in 1HFY25 (FY25 GDP growth is projected to be sluggish between 2.5% to 3.5%. The shortfall in tax collection has also widened.

Much talked about buildup in foreign exchange reserves to US$14 billion by June 2025, together with expected continued reserves buildup in FY26 even if the current account slips back into a modest deficit. 

Outlook for softer global growth, backed by recent IMF estimate downgrades and sharply lower oil prices.  

The brokerage house believes equities should find something to cheer after the rate cut, having suffered a difficult April, KSE-100 index shed 5.5% on Pakistan-India tensions. That said, given the pace of monetary easing in the previous twelve months, the brokerage house believes the SBP is likely to take a more cautious approach going forward.

With macroeconomic stabilization having been achieved, fiscal reforms remain important for lengthening the economic cycle. The coming Budget, expected in early June, will be a key checkpoint in this respect.

The brokerage house continues to remain positive on Pakistan equities. Its base-case KSE-100 Index target for end December 2025 is 130,000 points.

 

 

Kashmir conflict after Pahalgam attack

The most recent conflict between India and Pakistan in the Kashmir region has once again brought the area to the brink of a deep crisis, especially since both nations are armed with nuclear weapons.

India has upped the ante by blaming Pakistan for the tragedy, without providing credible evidence of this country’s alleged involvement in the brutal slaying of tourists.

The recent terrorist attack in Pahalgam in the Indian-administered Kashmir, which resulted in the tragic demise of numerous tourists, has not only intensified India's animosity towards Pakistan but has also garnered global scrutiny regarding the prospects of an extensive military conflict.

Since gaining independence in 1947, Kashmir has been split between India and Pakistan, with each country asserting ownership over the entire region while controlling distinct areas. This division has resulted in ongoing tensions that have escalated into conflict over time.

On Tuesday, at least 26 people were killed by suspected rebels at a resort in Pahalgam, making this the deadliest such attack in a quarter-century in Kashmir. A statement issued in the name of The Resistance Front (TRF), which is said to be part of the Lashkar-e-Taiba armed group, based in Pakistan, claimed responsibility.

The aftermath has prompted notable diplomatic pushback. India has declared its exit from the Indus Waters Treaty, an important water-sharing pact established by the World Bank in 1960, while Pakistan countered by suspending a significant canal irrigation initiative and prohibiting Indian flights from its airspace. 

Pakistani officials have dismissed India's allegations, with Defense Minister Khawaja Asif asserting that "blaming Pakistan won’t address" the issue of Kashmir’s disputed status. 

The Indian government has admitted failing to protect tourists at Pahalgam, Mallikarjum Kharge, president of the All India Congress Committee, said during a speech.

He added that the government confirmed during an all-party meeting on Thursday that a security lapse allowed the attack to happen.

Kharge, who heads the opposition in the upper house of India’s parliament, said a three-phase security plan was in place but ultimately failed.

Amid this volatile situation, Iran has taken on the role of a mediator, understanding the complex geopolitics of the subcontinent and choosing not to take sides.

Iran’s diplomatic initiative is underscored by its historical balancing act between India and Pakistan, maintaining strong ties with both while advocating for regional stability. 

On Friday, Iranian Foreign Minister Abbas Araghchi wrote on his X social account, “India and Pakistan are brotherly neighbors of Iran, enjoying relations rooted in centuries-old cultural and civilizational ties,” adding that “Tehran stands ready to use its good offices in Islamabad and New Delhi to forge greater understanding at this difficult time”.

Given the nuclear-armed status of both India and Pakistan, Iran’s mediation effort represents a crucial attempt to de-escalate tensions and prevent further destabilization in South Asia.

Tehran’s stance reflects its broader regional strategy to promote peace through dialogue and resist external powers’ divisive influences in the Kashmir dispute.

Pakistan said on Saturday it is “fully prepared to cooperate with any neutral investigators” following the Pahalgam attack.

In an editorial published on Saturday, Pakistan’s Dawn news outlet said, “It is time again to give diplomacy a chance as neither Pakistan nor India can afford war.”

The editorial added, “These are dangerous times in the subcontinent, and there is a need for both Pakistan and India to show restraint, and handle the post-Pahalgam developments with sense.

 

PSX witnesses volatility due to rising tension between India and Pakistan

Pakistan Stock Exchange (PSX) remained volatile throughout the week ended Friday 25, 2025, as escalating geopolitical tensions post the Pahalgam attack in Indian Occupied Kashmir and India’s subsequent threats to revoke the Indus Water Treaty with Pakistan further undermined investor sentiment. The KSE-100 index closed the week at 115,469 points, losing 1,846 points, down 1.57%WoW.

Positive news stemmed from the IMF's World Economic Outlook for April 2025, lowering Pakistan's inflation forecast for FY25 to 5.1%YoY and 7.7%YoY for FY26. On the flip side, growth projection for FY25 was revised slightly downward to 2.7%, from 2.8% previously.

The news reports indicate that authorities have reached a preliminary agreement with two foreign commercial banks for a US$1 billion loan facility, at interest rate of 7.6%.

Finance Minister met with representatives from credit rating agency Moody's in an effort to improve Pakistan's credit rating, following a recent upgrade by Fitch.

PKR depreciated 0.09%WoW against the greenback.

Foreign exchange reserves held by State Bank of Pakistan (SBP) decreased by US$367 million to US$10.2 billion as of April 18, 2025.

Other major news flow during the week included: 1) Finance Minister met with IMF chief, 2) Government urged to fully deregulate wheat supply chain, 3) Cabinet recommended to abolish FED on property transfer, 4) Kuwait announced to join Pakistan offshore bids and 5) Pakistan missed wheat production target.

Vanaspati & Allied Industries, Synthetic & Rayon, and Textile Spinning were amongst the top performers, while Refinery, Jute, and Transport were amongst the laggards.

Major selling was recorded by Banks/ DFI with a net sell of US$4.0 million. Organizations and Foreigners absorbed most of the selling with a net buy of US$6.9.

Top performing scrips of the week were: NATF, FCEPL, MUREB, ATLH, and SNGP, while laggards included: BOP, PIBTL, EPCL, AGL, and HUMNL.

According to Pakistan’s leading brokerage house, AKD Securities lower oil prices and favorable standing among exporting peers amid reciprocal tariffs will support Pakistan’s economy and strengthen the outlook for a return to single-digit interest rates in CY25.

The benchmark index is anticipated to sustain its upward trajectory, primarily driven by strong earnings in Fertilizers, sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability. Top pick of the brokerage house includes, OGDC, PPL, PSO, FFC, ENGROH, MEBL, MCB, HBL, FCCL, INDU, ILP and SYS.

Prince Faisal talks to Indian and Pakistani counterparts

Saudi Minister of Foreign Affairs Prince Faisal bin Farhan held separate phone calls with his counterparts in Pakistan and India on Friday. He discussed bilateral relations and the evolving regional situation amid rising tensions between the two South Asian nations, reports Saudi Gazette.

The diplomatic outreach followed a deadly militant attack on Tuesday near Pahalgam in the Indian-administered part of Kashmir’s scenic Pesarang Valley.

The assault claimed the lives of at least 26 people and triggered a wave of accusations and retaliatory measures from both sides.

Indian Foreign Minister Subrahmanyam Jaishankar said in a post on social media that he discussed the Pahalgam attack and its cross-border connections with Prince Faisal.

Pakistani Foreign Minister Ishaq Dar also posted on X, stating that the two ministers agreed to maintain consultations and coordination on the unfolding regional developments.

The Kashmir attack, which India has blamed on Pakistan-based militants, has sharply escalated tensions between the two nuclear-armed neighbors. In response, India suspended a key water-sharing treaty, closed a major land border crossing, and halted airspace and trade agreements with Pakistan.

Islamabad, in turn, warned of potential military action, further raising fears of a broader conflict.

India threatens to terminate Indus Water Treaty

India has announced to take a series of retaliatory measures, including its intent to terminate the Indus Waters Treaty. This significant development is likely to heighten geopolitical risks in the region.

The Treaty signed in 1960 between India and Pakistan under the mediation of the World Bank, governs the sharing of the waters of the Indus River and its tributaries. The treaty allocates the three eastern rivers (Ravi, Beas, and Sutlej) to India, and the three western rivers (Indus, Jhelum, and Chenab) to Pakistan, with limited rights for India to use the western rivers for non-consumptive purposes such as hydroelectric power generation.

The treaty has survived multiple conflicts and is considered one of the most successful examples of water-sharing agreements in the world.

If India were to unilaterally withdraw from the treaty, it would likely violate international law, as such agreements are generally considered binding and cannot be terminated unilaterally without consequences.

For Pakistan, any disruption to the flow of the western rivers could have severe implications for agriculture, which is the backbone of its economy, as well as for water availability in key regions. 

 

India downgrades ties with Pakistan

According to Reuters, India has announced a raft of measures to downgrade its ties with Pakistan on Wednesday, a day after suspected militants killed 26 men at a tourist destination in Kashmir in the worst attack on civilians in the country in nearly two decades.

Diplomatic ties between the nuclear-armed South Asian neighbours were weak even before the latest measures were announced as Pakistan had expelled India's envoy and not posted its own ambassador in New Delhi after India revoked the special status of Kashmir in 2019.

Pakistan had also halted its main train service to India and banned Indian films, seeking to exert diplomatic pressure.

Tuesday's attack is seen as a setback to what Indian Prime Minister Narendra Modi and his Hindu nationalist Bharatiya Janata Party have projected as a major achievement in revoking the semi-autonomous status Jammu and Kashmir enjoyed and bringing peace and development to the long-troubled Muslim-majority region.

On Wednesday, Indian Foreign Secretary Vikram Misri told a media briefing that the cross-border involvement in the Kashmir attack was underscored at a special security cabinet meeting, prompting it to act against Pakistan.

He said New Delhi would immediately suspend the 1960 Indus Waters Treaty "until Pakistan credibly and irrevocably abjures its support for cross-border terrorism."

The treaty, mediated by the World Bank, split the Indus River and its tributaries between the neighbours and regulated the sharing of water. It had so far withstood even wars between the neighbours.

Pakistan is heavily dependent on water flowing downstream from this river system from Indian Kashmir for its hydropower and irrigation needs. Suspending the treaty would allow India to deny Pakistan its share of the waters.

India also closed the only open land border crossing point between the two countries and said that those who have crossed into India can return through the point before May 01, 2025.

With no direct flights operating between the two countries, the move severs all transport links between them.

 

Pros and cons of importing US oil for Pakistan

Pakistan is considering importing crude oil from the United States to offset a trade imbalance that triggered higher US tariffs. However, many analysts question the economic viability of the proposal. Let us explore prose and cons of the proposal.

Pakistan imported 137,000 barrels per day of crude in 2024, mostly light grades from the Middle East, with Saudi Arabia and the United Arab Emirates among its top suppliers. Oil imports amounted over US$5 billion in 2024.

In February 2025, Saudi Arabia, through the Saudi Fund for Development (SFD), extended a US$1.2 billion financing facility to Pakistan for the import of oil products for a year. The SFD has provided approximately US$7 billion to Islamabad for oil products since 2019.

While the Government seems adamant at importing crude oil from the United States, experts have to find credible replies in favor of the move.

​Importing crude oil from the US could be a strategically viable option for Pakistan, but it involves several economic, logistical, and technical considerations.​

Potential Benefits

Reducing Trade Imbalance and Tariffs
Pakistan is exploring the import of US crude oil to address a US$3 billion trade surplus with the US, which has led to a 29% tariff on Pakistani exports. By purchasing approximately US$1 billion worth of US crude, Pakistan aims to mitigate these tariffs and improve trade relations.

Diversification of Energy Sources
Currently, Pakistan relies heavily on Middle Eastern countries for its crude oil imports, with Saudi Arabia and the UAE accounting for over 95% of its supply. Introducing US crude into the mix could enhance energy security by diversifying supply sources.

Challenges and Constraints

Refinery Compatibility
Pakistani refineries are primarily configured to process Middle Eastern light crude. While the exact compatibility with US crude grades varies, historical challenges with processing non-Middle Eastern crude, such as Russian oil, suggest potential technical limitations.

Higher Transportation Costs
Transporting crude oil from the United States involves longer distances as compared to Middle Eastern sources, leading to increased shipping costs and logistical complexities.

Dependence on Existing Financial Support
Saudi Arabia provides significant financial assistance to Pakistan for oil imports, shifting a portion of imports to the US might affect these favorable financing arrangements.

 Infrastructure Considerations

Pakistan's current oil import infrastructure includes ports like Karachi and specialized facilities such as Cnergyico's Single Point Mooring (SPM), capable of handling large crude carriers. While these facilities can accommodate increased imports, the overall capacity and efficiency of the supply chain would need assessment to handle US crude effectively.

Importing crude oil from the United States presents an opportunity to Pakistan to diversify its energy sources and address trade imbalances. However, it requires careful consideration of refinery capabilities, transportation logistics, and existing financial dependencies.